Trepp: CMBS Delinquency Rate Reaches Record High


The commercial mortgage-backed security delinquency rate reached an all-time high in May at 10.04%, up 24 basis points from the prior month, according to the latest data from Trepp LLC.

This represents the first time ever that the CMBS delinquency rate surpassed the 10% mark. Just three months ago, the CMBS delinquency rate was 9.37%, but has gone up substantially since.

The percentage of CMBS loans 60 or more days late through May is 9.51%, 10 basis points higher than the previous month.

Currently, $59.1 billion in commercial loans are delinquent and there are $79.2 billion in loans with the special servicer, Trepp said.

“The good news for the CMBS market is that the five-year loans originated in 2007 were heavily front-loaded,” the New York-based analytic firm said. “This means that by the end of June, the number of these loans reaching their maturity date starts to dwindle. As a result, the upward pressure that this has put on the rate should be coming to an end.”

Overall, four of the five largest property types saw delinquency rates increase, led by hotel and industrial loans. The hotel delinquency rate surged 172 basis points from April and is now 12.27%. Meanwhile, the industrial delinquency rate is up 46 basis points month-over-month and remains the second worst category at 12.82%.

Even though it was down one basis point in May from April, the multifamily CMBS delinquency rate is currently the highest at 15.17%.

Trepp said the office delinquency rate is 10.26%, while retail is still the best performing major property type with a delinquency rate of only 8.07%.


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